Smart Regulation Overlapping Agency Jurisdiction

A smarter and clearer allocation of permitting responsibilities among agencies would produce greater regulatory certainty, reduce delay, and enable Business Roundtable members to promote economic growth and create jobs.

Businesses commonly find themselves subject to two or more regulatory agencies exercising concurrent jurisdiction over a single issue. This problem is prevalent throughout government. Fragmented, overlapping or duplicative regulations and oversight do not simply increase compliance burdens, they increase the likelihood of inconsistency between agencies in how certain products or transactions are viewed, adding complexity and in some instances, conflict, that can undermine the regulatory objectives each agency is trying to achieve.  Additionally, the pursuit of enforcement actions by multiple agencies for the same action has become more frequent. Absent adequate coordination, this can lead to duplicative actions or penalties disproportionate to the alleged wrongdoing.

Overlapping and duplicative regulations from different agencies limit the ability for any single regulator to have an accurate view of the cumulative regulatory burden imposed on the regulated community. The ideal way to produce a more rational regulatory framework in any area is for Congress to pass legislation that streamlines and simplifies the regulatory process and eliminates redundancy.

There is much the President can accomplish without waiting for Congress to act. The President can use EO 13771 (Reducing Regulation and Controlling Regulatory Costs) and EO 13777 (Enforcing the Regulatory Reform Agenda) to focus needed attention on redundancy and waste. While these Executive Orders do not apply to independent regulatory agencies, they can be useful in highlighting areas in need of reform. Turning to specific areas of overlap or duplication, while there is no simple or generic solution, the Administration has a suite of options that it can choose from for particular situations. For example:

Negotiated memoranda of understanding between various regulatory agencies or ad hoc interagency working groups could be useful with respect to overlap involving multiple regulatory agencies, particularly independent regulatory agencies,

Designation of a lead agency, with other agencies having a cooperative or participating role, might be the best solution in some cases; and

With respect to new rulemakings touching the jurisdiction of multiple agencies, joint rulemakings that ensure government-wide internal consistency should be considered as the default approach.

With respect to enforcement actions, while businesses should be held to account for wrongdoing, greater inter-agency coordination where there are overlapping enforcement jurisdictions will reduce the possibility of duplicative actions or penalties that are disproportionate to the alleged wrongdoing. OMB should consider mechanisms for fostering greater coordination among agencies with regard to enforcement actions and penalty determinations.

Good government requires the elimination of wasteful and duplicative arrangements wherever possible. Congress will need to rationalize the regulatory framework that has built up over many decades in order to accomplish complete reform, but much can be done administratively to improve the process and encourage and facilitate collaboration.